East African banks are increasingly adopting artificial intelligence to combat surging fraud and money laundering in their rapidly digitalizing markets. In Kenya alone, mobile-money transfers reached 7.95 trillion shillings in 2023, with 84.6 million subscriptions by early 2025 – outpacing the national population.
As digital adoption grows, so too does financial crime. Fraudsters exploit fragmented data systems, inconsistent regulations and siloed monitoring across multiple countries, making it difficult for legacy anti-money laundering systems to work effectively.
To respond, regional banking giant I&M Group has partnered with AI specialist ThetaRay to deploy unsupervised machine learning tools across its five East African markets. The platform monitors billions of transactions in real time, identifying anomalies by analyzing patterns instead of relying solely on predefined thresholds.
Gul Khan, I&M Group’s CEO, says the technology enables scalable, proactive risk detection without compromising customer experience.
The effort aligns with the East African Community’s push for financial integration and regulatory harmonization. Though cross-border instant payments exceeded 1.2 billion in 2022, inconsistent rules across nations have created loopholes for illicit finance.
AI offers solutions: ThetaRay’s system flags abnormal activity based on variables like geography, counterparty relationships and transaction history—updating in real time to reduce false positives and speed investigations.
Robust compliance is also critical for maintaining customer trust; Kenya’s Data Protection Act (2019) requires explainable, auditable AI systems.
While East Africa leads in mobile-banking innovation, the digital shift increases vulnerability to cybercrime and fraud. Banks like I&M are betting on intelligent AML systems to uphold security, efficiency and trust across borders
